Drop Dead Fred
Platinum Member
- Jun 6, 2020
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As a Libertarian, I’m against tax loopholes. I want the tax code to be as simple as possible, and with marginal tax rates as low as possible.
Democrats prefer higher marginal tax rates, so they can claim that they want to “soak the rich.”
But at the same time, these Democrats also favor giving rich people all sorts of loopholes, writeoffs, and deductions, so they don’t actually have to pay those taxes.
And now, liberals are angry at Trump for using a tax loophole that was signed into law by Obama.
The New York Times just reported:
www.nytimes.com
Mr. Trump harvested that refund bonanza by declaring huge business losses — a total of $1.4 billion from his core businesses for 2008 and 2009 — that tax laws had prevented him from using in prior years.
But to turn that long arc of failure into a giant refund check, he relied on some deft accounting footwork and an unwitting gift from an unlikely source — Mr. Obama.
Business losses can work like a tax-avoidance coupon: A dollar lost on one business reduces a dollar of taxable income from elsewhere. The types and amounts of income that can be used in a given year vary, depending on an owner’s tax status. But some losses can be saved for later use, or even used to request a refund on taxes paid in a prior year.
Until 2009, those coupons could be used to wipe away taxes going back only two years. But that November, the window was more than doubled by a little-noticed provision in a bill Mr. Obama signed as part of the Great Recession recovery effort. Now business owners could request full refunds of taxes paid in the prior four years, and 50 percent of those from the year before that.
Mr. Trump had paid no income taxes in 2008. But the change meant that when he filed his taxes for 2009, he could seek a refund of not just the $13.3 million he had paid in 2007, but also the combined $56.9 million paid in 2005 and 2006, when “The Apprentice” created what was likely the biggest income tax bite of his life.
The records reviewed by The Times indicate that Mr. Trump filed for the first of several tranches of his refund several weeks later, in January 2010. That set off what tax professionals refer to as a “quickie refund,” a check processed in 90 days on a tentative basis, pending an audit by the I.R.S.
His total federal income tax refund would eventually grow to $70.1 million, plus $2,733,184 in interest. He also received $21.2 million in state and local refunds, which often piggyback on federal filings.
Democrats prefer higher marginal tax rates, so they can claim that they want to “soak the rich.”
But at the same time, these Democrats also favor giving rich people all sorts of loopholes, writeoffs, and deductions, so they don’t actually have to pay those taxes.
And now, liberals are angry at Trump for using a tax loophole that was signed into law by Obama.
The New York Times just reported:
Trump’s Taxes Show Chronic Losses and Years of Income Tax Avoidance (Published 2020)
The Times obtained Donald Trump’s tax information extending over more than two decades, revealing struggling properties, vast write-offs, an audit battle and hundreds of millions in debt coming due.
Mr. Trump harvested that refund bonanza by declaring huge business losses — a total of $1.4 billion from his core businesses for 2008 and 2009 — that tax laws had prevented him from using in prior years.
But to turn that long arc of failure into a giant refund check, he relied on some deft accounting footwork and an unwitting gift from an unlikely source — Mr. Obama.
Business losses can work like a tax-avoidance coupon: A dollar lost on one business reduces a dollar of taxable income from elsewhere. The types and amounts of income that can be used in a given year vary, depending on an owner’s tax status. But some losses can be saved for later use, or even used to request a refund on taxes paid in a prior year.
Until 2009, those coupons could be used to wipe away taxes going back only two years. But that November, the window was more than doubled by a little-noticed provision in a bill Mr. Obama signed as part of the Great Recession recovery effort. Now business owners could request full refunds of taxes paid in the prior four years, and 50 percent of those from the year before that.
Mr. Trump had paid no income taxes in 2008. But the change meant that when he filed his taxes for 2009, he could seek a refund of not just the $13.3 million he had paid in 2007, but also the combined $56.9 million paid in 2005 and 2006, when “The Apprentice” created what was likely the biggest income tax bite of his life.
The records reviewed by The Times indicate that Mr. Trump filed for the first of several tranches of his refund several weeks later, in January 2010. That set off what tax professionals refer to as a “quickie refund,” a check processed in 90 days on a tentative basis, pending an audit by the I.R.S.
His total federal income tax refund would eventually grow to $70.1 million, plus $2,733,184 in interest. He also received $21.2 million in state and local refunds, which often piggyback on federal filings.
